Essays on the labour market outcomes of immigrants in the UK

The present thesis comprises three essays on the labour market outcomes of immigrants in the United Kingdom (UK). Chapter 1 introduces the thesis, outlines its contribution and provides an overview of each of the three essays. Chapter 2 evaluates the role of immigration policy on the occupational outcomes of immigrants to the UK. We use a quasi-natural experiment to tease out the role of immigration policy on the occupational outcomes of immigrants from other factors that affect these outcomes. Looking at a sample of immigrants who entered the UK shortly before and after 2004, the findings suggest that the change in the UK’s 2004 immigration policy only led to a slight increase, although not statistically robust, in the odds of observing A8 immigrants who entered the UK after 2004 in elementary occupations relative to professional occupations. We unearth evidence that A8 immigrants with longer durations of stay in the country have better occupational outcomes. Also, the occupational attainment gap between A8 immigrants and UK-born individuals reduces drastically once one controls for income levels in the source country of the immigrant. In Chapter 3, we examine the implications of networks of social contacts for the occupational outcomes of immigrants with different lengths of stay in the host country. It is commonly assumed that immigrants principally rely on co-ethnics to find employment. Using a direct measure on whether employment was obtained by referral or other means, we find that while this common assumption remains true for immigrants who recently arrived in the UK, co-ethnics no longer appear to be the main source of referrals for more established immigrants. Thus it seems that the social network of contacts of an immigrant potentially extends to include individuals from other countries as their stay in the host country lengthens. This implies that immigrants may undergo a process of “social assimilation” by broadening their network of social contacts. If this diversification improves the “quality” of the network, it could lead to better labour market outcomes. In Chapter 4, we look at the labour market outcomes of different groups of immigrants and the children born to them in the UK, in comparison to natives. Most previous studies assume that all UK-born of non-White ethnicity are children of immigrants because the data commonly used do not identify the place of birth of the respondent’s parents. In light of the history of immigration of some ethnic groups in the UK, however, such an assumption may lead to classification errors in the data, which could have severe consequences for implications of intergenerational mobility in labour market outcomes. Our analysis shows that even an apparently negligible amount of classification errors in the data can cause high level of uncertainty in the estimates of the parameters of interest. Additionally, for the first time in this literature we use a dataset that contains information on parental country of birth to examine labour market outcomes across all major ethnic groups in the UK. Chapter 5 concludes the thesis, and future research topics/directions are discussed.